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The Edge Malaysia, 12 Jun 2014
Singapore is confronting the perils of please-all economics. Ageing citizens are pushing the government for bigger nest eggs and more subsidised healthcare and housing. There is also popular resentment against letting more foreigners in, and not much appetite for increasing the 7 percent consumption tax. Squaring this fiscal circle will be a long-term challenge.
Already, there's simmering anger in the city-state about overcrowded trains and costly public housing. About 2,000 people gathered recently to demand that the state-run retirement plan raise its 4 percent annual interest rate. People protested last year, too, when the government unveiled a plan to boost the resident population by 30 percent to 6.9 million by 2030, with immigration compensating for a drooping birth rate.
The multifaceted discontent puts Singapore's fiscally conservative government in a quandary. Expanding the economy - and the tax base - with less foreign labour will mean improving the productivity of the local workforce. Full story